Chip shares surge in ‘historic’ month | UNW

This report is from this week’s The Tech Download newsletter. Like what you see? You can subscribe here.

After a month or so in the doldrums as investors rode a wave of anxiety about the AI buildout, chip stocks have hit a real purple patch again in April.

In March, Nasdaq’s PHLX Semiconductor Sector Index — comprising the 30 largest U.S.-traded chip companies — saw a 6.3% decrease. Last month, the narrative reversed, with the index soaring 35.2% since the start of April as of market close Wednesday as investors ploughed into the sector. 

Intel has been one of the standouts. The company had its best day since 1987 last Friday, on the back of earnings that topped estimates and issued upbeat guidance. Nvidia’s market cap breached the $5 trillion mark ahead of its earnings, and Apple‘s stock rose Thursday after it posted revenue growth for the most recent quarter that beat estimates and its guidance was better than expected.

Many U.S. chip darlings, including AMD and Micron, have also surged, as have a number of Europe’s leading semiconductor companies. 

“The semiconductor tape we have seen this month is nothing short of historic,” Bruce Bateman, chief analyst at Omdia, told me. “We are talking about winning streaks not seen since the 1970s.”

The rally in semiconductor stocks over the past month reflects a combination of renewed confidence in the AI infrastructure cycle, stronger earnings commentary and the sense that demand is broadening “beyond just a few obvious AI winners,” said David Miller, senior portfolio manager at Catalyst Funds.

In the U.S., sentiment is supported by the belief that AI demand is turning into real revenue growth, leading to higher earnings estimates, Miller told me. 

Concerns over hyperscalers massive AI spending plans announced at the start of 2026 saw a $1 trillion selloff in February, but investors have steadied their resolve in recent weeks.

“Continued positive news flow and earnings results from the AI infrastructure players has allowed investors to get a better level of comfort with the size of the capital expenditures taking place, which has led to sentiment turning positive,” said Michael Field, chief equity strategist at Morningstar.

Some of the surge is related to the Iran war, Bob Savage, head of markets macro strategy at BNY told me, as chip orders have increased in anticipation of supply chain disruptions.

But, while the market is pricing a “clean narrative” of growth, it’s “overlooking a massive wall of physical reality,” Bateman told me.

The Iran war has also created critical bottlenecks, which are hitting the core of chipmaking, he added. 

Exports of helium, a key material in chipmaking and other manufacturing processes, have already been significantly curtailed by the fighting, and some European companies have faced delays to semiconductor deliveries from Asia due to flight path disruption.

The U.S. data center buildout is also reportedly seeing delays and shortages of key equipment like transformers. “We aren’t seeing a lack of interest; we’re seeing a lack of capacity,” said Bateman.

Other analysts are far more bullish, putting their faith in demand for compute continuing to grow — spurring on those big AI infrastructure projects.

“The sector can still move higher if three things remain true,” said Miller. “Hyperscaler capex stays resilient, earnings estimates continue to move up, and investors remain convinced that AI infrastructure spending is producing real returns.”

Anthropic in talks with investors to raise funds at a $900 billion valuation, a person familiar with the matter told CNBC.

Samsung Electronics reported an over eightfold increase in first-quarter operating profits on Thursday, hitting a new record and beating analysts’ estimates on the explosive growth of its chip business.

A major data center company paused investment in AI infrastructure projects in the Middle East amid the Iran war, its CEO told CNBC.

The Department of Defense is expanding its use of Google’s Gemini AI model, about two months after it dropped Anthropic, designating it as a supply chain risk, the Pentagon’s AI chief confirmed to CNBC.

Top researchers are jumping ship from Big Tech firms like Meta and Google to launch startups and raising huge funding rounds in the process, as investors bet big on the commercial potential of early-stage AI labs.

And lastly, some rather lofty words from the founder of a new AI startup.

Announcing Ineffable Intelligence’s $1.1 billion raise at a $5.1 billion valuation just months on from launching, founder David Silver — a former top researcher at Google DeepMind — said the company was aiming to “transcend the greatest inventions in human history, such as language, science, mathematics and technology.”

Big talk.